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Customer Experience Metrics for Insurance

By Lightico Marketing Team

How do you evaluate the customer experience (CX) of your clients? How do you identify areas that need improvement? With the unique combination of digital tools and traditional person-to-person customer interaction, assessing CX in the insurance industry isn’t always straightforward. If you want to see where you stand, look into these customer experience metrics for insurance.

Insurance Metrics to Watch

Claim Processing Rate: No client wants their claim to hang in limbo. They want a swift and accurate resolution. Monitor the time it takes to process an insurance claim from the first notice of loss (FNOL) to claim payout or denial. If the time has lengthened from previous benchmarks or your average processing time is longer than the industry standard, it’s time to look for inefficiencies and identify ways to shorten your average. The faster you resolve claims, the happier your customers will be. Claim Denial Rate: Compare your claim denial rate to the industry average. If there’s a significant difference, your customers are negatively affected in one of two ways. First, if you deny more claims than average, you’re going to have customers unhappy that their insurance isn’t serving them in the way they thought it would. Second, if you deny fewer claims than average, you may be paying out on claims that shouldn’t have been approved, increasing your costs that get passed on to the consumer in the form of higher premiums. Either way, it negatively impacts the customer experience. Straight-Through Processing Rate: The straight-through processing (STP) rate is the percentage of claims processed without manual intervention. These claims are typically straightforward and processed with the help of algorithms and automation. Not every insurance company has STP; its use depends on the complexity of the products sold. However, when STP is an option for uncomplicated products, it’s a huge hit with customers because it typically involves an easy claims FNOL process and short claim processing times. Review your STP rate and see if there’s a possibility of additional workflow automation to extend STP offerings. Time to Coverage: Customers don’t want to wait when they're buying insurance policies. They have little tolerance for long wait times between application, purchase, and coverage. If you can’t offer your product quickly, they’ll find someone else who can. Watch the average time to coverage for new customers and find ways to make that time as short as possible.  Customer Retention Rate: If a customer is happy, they’ll stay with you. If they’re not, shopping around has never been easier. In an environment where it’s never been easier to lose customers, you can measure the quality of your CX in insurance by taking a quick peek at your retention rate. If you’ve got high customer churn, it may indicate that you’re doing well attracting new customers, but the CX for your existing customers leaves something to be desired. Imagine the difference if you could attract all those new customers AND retain the ones who left. Watch the customer experience metrics at all points in the customer journey. Customer Referral Rate: Customer referrals are a reliable indicator of whether your clients are happy with their experience. They’re not going to recommend something to their friends and family if they don’t have a high personal opinion of it. Track the number of new customers referred by an existing customer. For an additional metric in this category, track the Net Promoter Score (NPS). This score is calculated based on direct customer feedback and evaluates how likely customers are to refer someone to your business. Customer Satisfaction Rate: Evaluating the customer experience doesn’t have to be complicated. Want to know what your customers think of their customer experience in insurance? Ask them! Your customer satisfaction rate (CSAT) speaks volumes. If your customer satisfaction levels are low, make changes. Don't just do this once; create a customer feedback program or send out customer satisfaction surveys to solicit ongoing business metrics to inform your operations. Conversion Rate: The conversion rate has become a valuable metric in e-commerce. However,  understanding what a conversion is can be challenging. It’s even more challenging in the insurance industry, where the customer experience is often a combination of digital and human interactions. Still, it’s worth paying attention to your online conversion rate, because here’s a secret: A conversion is anything you want it to be. Define what you consider a successful conversion and track whether your digital platform creates the CX to get that desired result. For example, track how many customers begin filing a claim online but never finish it. See how many customers click on your “request a quote” button but never submit the form. Calculate the percentage of customers who tried to complete a straight-through claim but struggled with the document collection process. See where people are getting stuck in their digital CX, and make adjustments to improve their experience. Heatmaps: Use heatmaps or experience mapping to evaluate the CX on your customer service portal or website. Identify where customers are getting frustrated and exiting your website. See where they’re clicking the back button frequently because the navigation didn’t take them where they expected. Review search queries to see what information or features customers are looking for and make those things easily available so customers don’t have to go digging for the things they want. Use metrics from heatmaps or experience mapping to monitor browsing trends and identify where to improve the digital customer experience in insurance on your website or other digital interfaces. Use Customer Experience Metrics for Insurance to Improve Your Business Processes The best business decisions are data-driven decisions. Accurate customer experience metrics for insurance help you set business goals and prioritize where business process improvements are needed. When you identify where you’re not measuring up, you can invest in tools to help you improve the customer experience. Tools like e-signatures and ID verification, eForms, digital document collection software, and workflow automation systems can dramatically improve the customer experience in insurance. As a bonus, most of these tools have the added benefit of reducing the administrative workload. Diving into CX analytics can be overwhelming, but you can start by identifying a few key metrics to watch and implementing strategic changes to improve them. Because when you pay attention, the data will tell you what you need to do to improve the customer experience. It really is that simple.

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